OPENING THE GATES TO EUROPE

A strong competitive economy, a highly skilled workforce, and strategic location in mainland Europe are the key factors attracting a growing number of Irish businesses to relocate their operations to the Netherlands. Niamh MacSweeney reports.

One of the most densely populated countries in the world, the Netherlands is situated in northwestern Europe. The largest of the Benelux nations, including Belgium and Luxembourg, more than half of the Netherlands is below sea level and therefore famous for its windmills, which were originally used to pump excess water off the flooded land and dykes. Because large parts of the country have been reclaimed from the sea, the Netherlands is sometimes referred to as the ‘land won from the sea’ and the Dutch have a saying ‘God created the world, but the Dutch created the Netherlands.’

ECONOMIC FOUNDATIONS

An impressive trading nation, several major rivers of Europe flow through the Netherlands into the North Sea and because of this foreign trade has become the foundation of the Dutch economy. Often described as the gateway to Europe, the Netherlands, which is perfectly situated in the centre of Europe, is surrounded by or relatively close to other large European countries such as Germany, Belgium and France. Being strategically located with the estuaries of three major European rivers, the Rhine, the Meuse and the Schelde, merely adds to the prospects on offer and the benefits to be gained in a country that exudes a robust logistics and transshipment industry sector. Bert van der Lingen, Deputy Head of Mission at the Netherlands Embassy in Dublin maintains that trade is the lifeblood of the Dutch economy and that the Netherlands is a springboard to other European communities. “We have a highly developed infrastructure system and penetration of broadband is the highest, in Europe second only to Finland,” he adds.

An open, dynamic and highly competitive market is visible in the Netherlands and Charlotte Field, Enterprise Ireland Manager for the Benelux Region, agrees there are many opportunities available for companies willing to invest time and money in forging relationships in the country.

EUROPEAN GATEWAY

Field maintains that there are a number of reasons why Irish companies should consider re-locating or establishing their business in the Netherlands. “The Dutch market is fast moving, dynamic, highly competitive and mature. It is one of the most open trading economies in the EU,” she says. She also points out that the Netherlands can be a bridge to other European countries and that Irish companies can validate their proposition in the Dutch market before moving in to other European markets. “The market is small enough to be an ideal test bed for new innovative products and services in many sectors, although at nearly 17 million consumers it is also a substantial market size in its own right,” Field reiterates.

Infrastructure and accessibility are crucial factors for any business and the Netherlands has plenty to offer in this regard with excellent road, railway and waterway infrastructure. Rotterdam is the world’s biggest port and one of the biggest European air transport hubs at Amsterdam’s Schiphol Airport, ensures a massive amount of Asian and North American imports to Europe are transshipped through the country’s two main transport centres. Van der Lingen agrees that location is crucial and has obvious advantages for businesses based in the Netherlands. “A lot the exports from Ireland are coming into continental Europe through Rotherham and Schiphol. It is not just about providing high quality goods and services its about the availability and proximity to the market in a globalised economy,” van der Lingen says.

ECONOMIC GROWTH

Economic prospects for both 2007 and 2008 are encouraging, with an expected growth of 2.75% in both years. “The economy is tightening further, which is particularly noticeable in the labour market. Unemployment is decreasing to 4% of the labour force in 2008. There is consequently some upwards pressure on the increase in contractual wages and given this favourable cyclical development, the EMU balance will improve to 0.7% of gross domestic product (GDP),” Field explains. These positive economic developments are also highlighted in the Central Economic Plan 2007, published by the Netherlands Bureau for Economic Policy Analysis (CPB) which finds that not only is the Dutch economy performing well but that employment is increasing faster than labour supply. The report also reveals that despite wages increases expected from 2.25% this year to 3.25% in 2008, inflation is estimated to be only 1.25% in both 2007 and 2008, thanks to the expected decrease in the oil price and the appreciation of the euro vis-à-vis the US dollar.

IRISH IMPORTS & EXPORTS

According to 2006 Central Statistics Office (CSO) figures, Irish exports to the Netherlands produced €3.4 billion and Irish imports from the Netherlands generated €2.4 billion. The Enterprise Ireland Annual Business Survey found that the Netherlands accounted for €348 million in exports for Irish indigenous firms in 2005. The 2007 report (2006 results) will be available shortly and Enterprise Ireland anticipate an increase to reach up to €380 million.

SUPORTING IRISH BUSINESSES

Field says there are many reasons why Irish businesses should consider establishing their business in the Netherlands and that due to the supports available the whole process can be an easy one. “Enterprise Ireland works with Irish companies to help them identify market opportunities, new customers, resellers and agents, and business experts who can assist them on a one to one basis. Once established in the market, Enterprise Ireland supports them to maintain existing customers and build new ones, eventually moving towards a full-time in market presence,” she explains Pieter Van Gulik, Executive Director of the Netherlands Foreign Investment Agency (NFIA), UK and Ireland points out the NFIA assists companies in setting up, expanding or restructuring their European operations in the Netherlands. “As part of the Ministry of Economic Affairs, we facilitate a company direct investment in the Netherlands. So whether you are developing a first European presence or reconfiguring existing European operations, the NFIA can help companies obtain information and practical assistance to ensure that their business will flourish,” he comments.

Amsterdam Tram	Bruggen Bridge	Flower Market